The U.S. Department of State’s Investment Climate Statements provide information on the business climates of more than 170 economies and are prepared by economic officers stationed in embassies and posts around the world. They analyze a variety of economies that are or could be markets for U.S. businesses. The Investment Climate Statements are also references for working with partner governments to create enabling business environments that are not only economically sound, but address issues of labor, human rights, responsible business conduct, and steps taken to combat corruption. The reports cover topics including Openness to Investment, Legal and Regulatory Systems, Protection of Real and Intellectual Property Rights, Financial Sector, State-Owned Enterprises, Responsible Business Conduct, and Corruption.
Executive Summary
The International Monetary Fund (IMF), the Bank of Central African States (BEAC), and the Government of Republic of the Congo (Republic of the Congo) project an increase of 4 percent of the gross domestic product (GDP) in 2024, up from 3.6 percent in 2023.
Before the COVID-19 outbreak, the Republic of the Congo struggled with the effects of the 2014 drop in oil prices. Poor governance and a lack of economic diversification pushed the Republic of the Congo to near insolvency, reduced its creditworthiness, and forced the Central Bank to expend significant foreign currency reserves.
Oil represents the largest sector of the economy and contributes about 55 percent of the government’s annual declared revenue. The primary non-oil sectors are timber, telecommunications, banking, construction, and agriculture. The Republic of the Congo has resources for economic diversification, with vast swaths of arable land, some of the largest iron ore and potash deposits in the world, a heavily forested land mass, and a deep-water International Ship and Port Facility Security Code-certified port. The Republic of the Congo is eligible for the U.S. African Growth and Opportunity Act (AGOA) trade preferences since October 2000, providing incentive for export-related investment. The Republic of the Congo also participates in the Central African Economic and Monetary Community (CEMAC).
The largest current infrastructure project is major road repairs on the section of highway between Brazzaville and Owando and the road between Owando and the border with Cameroon; the initial project to Owando was completed in 2016. Republic of the Congo’s nascent internet and inconsistent supplies of electricity and water present major hurdles to and opportunities for foreign direct investment. Significant sections of the country’s road system need maintenance or paving. The limited railroad network competes with truck and bus traffic for commercial cargo. However, some infrastructure projects are in progress in several cities, and the government reports spending significant amounts on infrastructure improvements.
Investors report that the commercial environment in Republic of the Congo has not improved substantially in recent years. Republic of the Congo ranked 162 out of 180 countries in Transparency International’s 2021 Corruption Perceptions Index. American businesses operating in Republic of the Congo and those considering establishing a presence regularly report obstacles linked to corruption, lack of transparency, subjective application of legal codes and host government inefficiency in matters such as registering businesses, obtaining land titles, paying taxes, and negotiating natural resource contracts.